Written question asked by Lord Bruce of Bennachie (Liberal Democrat), in the House of Commons. It was due for an answer on Monday, 3 February 1997. It was answered by Michael Jack (Conservative) on Monday, 3 February 1997 on behalf of the Treasury.

Treasury

Question: If he will estimate the annual cost of providing income tax relief at the lower band rate of tax for all United Kingdom domestic rail passenger fares, assuming that such a change had no demand effects. - (Holding answer 30 January 1997).

Answer: Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer if he will estimate the annual cost of providing income tax relief at the lower band rate of tax for all United Kingdom domestic rail passenger fares, assuming that such a change had no demand effects; and if he will make a statement. [13341] Mr. Jack: [holding answer 30 January 1997]: Such a relief would be equivalent to an indirect subsidy to the rail companies, with uncertain effects on rail fares. If the relief were to be given at source, then the full-year cost, based on 1995-96 fare levels and assuming no change in demand, would be about £475 million. This includes the element attributable to non-taxpayers which would score as public expenditure.

Secondary information